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Equity Will Drive LIIF’s Business

Family of four stands in front of home on tree-lined street

This post is featured in LIIF’s 2020 Annual Impact Report.

LIIF is reimagining how we build our business to reflect our new mission and vision and to achieve our goal of mobilizing $5 billion in capital for racial equity.

The COVID-19 pandemic has brought immense challenges to our country, and Black, Latino and Indigenous communities have been hardest hit by the dual health and economic crises of the pandemic. These disparities, the result of hundreds of years of systemic racism, are a clear illustration of why LIIF — and all lenders — must prioritize racial equity.

Our country is still living with its legacy of White supremacy as the recent insurrection at the U.S. Capitol illustrates. It is more important now than ever for us to deepen our engagement with the communities of color we serve to ensure our lending and programs are shaped by and meet their needs. As LIIF’s CEO and Board Chair highlight, the events of 2020 have forced people, particularly people of color, to “struggle to simply be safe, seen, healthy and housed,” and this has served to crystallize the need for our new direction. Across the three core areas of our Strategic Plan — housing, early care and education and impact-led lending — we are changing the way we work and how we engage with our partners.


Our housing system is fraught with inequities, and the finance and housing industries have perpetuated segregation and exacerbated the racial wealth gap through discriminatory policies and exclusionary programs. The COVID-19 pandemic has accelerated the severity of and inequity within our nation’s affordable housing crisis. In this context, we have sought to advance initiatives that meet the immediate and serious needs of communities, while also being mindful of the long-term changes needed to address racial inequality. Our approach builds on our longstanding focus on preservation and anti-displacement and aims to be responsive to developers facing an uncertain economic environment and increased needs from their residents and communities. Highlights of how LIIF is responding to urgent, unmet housing needs, as well as the stresses placed on developers, include:

  • Our recently announced joint venture with SAHF and NAHT will raise $1 billion over the next five years to create, protect and preserve 10,000 affordable homes. LIIF, NAHT and SAHF, as well as SAHF’s members, have a strong track record of deep community engagement. We are all seeking to improve and increase our work to center resident agency and voice, with a strong focus on racial equity, in order to create communities that meaningfully serve the needs of residents. Through our partnership, we’ll work even more collaboratively to develop new products and grow this critical work in communities across the country.
  • LIIF launched a $20 million COVID-19 Low Income Housing Tax Credit Developer Fee Bridge Initiative to support affordable housing developers grappling with financial challenges in the wake of the coronavirus pandemic and ensuing recession.
  • LIIF has partnered with Lift To Rise, a community-based organization in California’s Coachella Valley, to launch the Coachella Valley Affordable Housing Initiative. The seasonal workers in the area’s farming and hospitality industries often live in sub-standard housing that lacks basic infrastructure, like sewage systems, potable water and electricity. The initiative aims to develop high-quality, affordable housing paired with critical services, including early care and education, to meet the needs of these highly rent-burdened, predominately Latino residents of the Coachella Valley.

Early Care and Education

LIIF has worked for more than 25 years in the early care and education (ECE) sector, and the COVID-19 pandemic has brought the chronic underfunding of these small businesses into sharp focus. Our relief efforts have marshalled more than $26 million to help keep more than 1,300 providers, the majority of whom are women of color and immigrants, in business during shut downs and reductions in tuition. Over the course of the pandemic, LIIF has supported these essential workers and small business owners by launching ECE COVID emergency grant programs in the San Francisco Bay Area, Los Angeles, New York City and Washington, D.C. In addition, we partnered with Community Reinvestment Fund, USA to help providers secure Paycheck Protection Program (PPP) funding. To date, we have provided more than 1,500 grants and more than $6.6 million in PPP financing.

Still, we know these relief efforts on their own are not enough. LIIF has engaged in policy advocacy for federal ECE funding to help ensure that this country’s child care system is sustainable for the long term. We believe that high-quality early care and education is a public good. Our nation should invest in ECE’s “triple halo” effect for children, families and the economy. ECE has a profound positive impact on children’s brain development and life trajectory, particularly for low income children. It also provides support for parents to work or pursue education, and ECE small business, owned and operated predominantly by women of color, are economic drivers in their communities.

Impact-Led Lending

This year, LIIF is launching an impact-risk-profitability framework as part of our new strategic plan. To hold ourselves accountable to our goal of mobilizing $5 billion in capital to advance racial equity, we are developing new screening and evaluation tools for investments that will measure our progress in advancing racial equity and supporting communities of equity, opportunity and well-being. We will use these screening and evaluation tools alongside robust measures of risk and return to ensure LIIF’s business is sustainable over the long-term while also achieving our impact goals.

Using this new framework, LIIF aims to deepen our racial equity work and better measure the impact of projects like LIIF’s recent loan to the Northern California Land Trust (NCLT). LIIF’s financing enabled NCLT to preserve 16 permanently affordable homes for existing residents in Oakland. NCLT’s goal is ultimately to provide tenants with an opportunity to own the building through a co-operative. By defining new measures and understanding the financing risks of projects like this, LIIF plans to expand our support for innovative community-driven initiatives that tackle complex issues such as displacement and structural racism.

LIIF’s goals are ambitious. We know we will not achieve them all in exactly the way we imagine today. We will continue to evolve the way we work, how we deploy capital and how we measure success. We are committed to continuing to reflect on our progress and to routinely engage staff and community stakeholders as we move forward. This past year of pandemic and charged political climate has made clear that this work is vital. We believe LIIF has the right goals and plan to move toward a future where all communities are communities of opportunity, equity and well-being.